Chestertons Dubai Real Estate Market Report – Q1 2025

Welcome to the Ultimate Guide for Real Estate in 2025

Dubai’s real estate market surged ahead in Q1 2025, reinforcing its position as a global investment hub. With total sales transaction value climbing by 29.46% to AED 151.6 billion, and volumes exceeding 54,800 transactions, the market demonstrated strong resilience, investor confidence, and continued international appeal.
Apartments dominated in volume, while villas and townhouses led in value growth — reflecting evolving buyer preferences and long-term lifestyle shifts. The leasing market also saw healthy momentum, and off-plan sales surged by over 21%, underpinned by flexible payment plans and innovative developments from top-tier developers.

Residential Sales:

Total sales transaction value: AED 151.6 billion (+29.46% YoY)
Total transaction volume: 54,836 sales (+29.46% YoY)

The off-plan market reached AED 53.83 billion with nearly 25,000 transactions, reflecting a 21.26% increase YoY, driven by attractive developer offerings and sustained investor demand.
Villas and townhouses recorded the strongest price growth, with transaction value rising by 51.93% and volume by 45.71%, highlighting growing interest in spacious, family-oriented living.

Residential Leasing:

Leasing transaction value: AED 14.6 billion (+18.7% YoY)
Total leasing transactions: 166,900 (+2.7% YoY)

Demand for both apartments and villas remains high, with rental values seeing double-digit growth — particularly for apartments, which rose 21.4% in value. The steady rise in volumes reflects Dubai’s growing appeal to long-term residents and relocating families.

Commercial Sales:

Commercial sales transaction value: AED 41 billion (−18% YoY)
Commercial leasing value: AED 8.6 billion (+10.26% YoY)

While total sales value declined, transaction volume rose by 23.4%, reflecting strong demand amid limited premium supply. The market is experiencing a shortage of Grade A commercial space, prompting businesses to explore secondary areas and plan ahead for upcoming developments.

Market Trends & Key Takeaways

Upfront Costs Reshaping Buyer Strategy

As of February 2025, banks and lenders are no longer allowed to include DLD registration fees and broker commissions in mortgage financing. This shift is increasing upfront costs for buyers, prompting a stronger pivot toward off-plan properties with more flexible payment structures.

Supply Pressure Fueling Price Growth
Both residential and commercial markets are experiencing tightening supply, especially in prime locations. As international demand surges, competition is intensifying for limited stock — a trend likely to continue through 2025.

Smart Rental Index Boosts Transparency
The Smart Rental Index 2025, launched by the Dubai Land Department, uses AI and real-time building data to create more accurate rental benchmarks. This has helped build confidence among landlords and tenants alike, ensuring fairer pricing across the city.

Real Estate Tokenisation Signals a New Era
Dubai has launched its pilot phase for tokenizing real estate assets, a step that could revolutionize accessibility by enabling fractional ownership and increased liquidity in the market. It’s a game-changer aimed at attracting global tech-savvy investors.

A Message from Our COO, Mania Merrikhi

As we celebrate 220 years of Chestertons, we continue to evolve with the market — not only by understanding its complexities but by helping shape its future. The Q1 results reaffirm Dubai’s position as a global real estate leader, and our team remains committed to guiding clients with insight, strategy, and passion.

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